Saturday, December 7, 2019

Best Daily Count Since Last December

The chart below reflects the NQ 100 futures using two-day bars. This count contains the best upward count out  of the December, 2018 low I can muster. Any other count breaks too many guidelines or rules. A similar count developed on the ES to Minor wave W is and was my preferred count.

NQ 100 Futures - Two Day OHLC - Best Count

On the left-hand-side of the chart, readers will note the overall count up from last December to the May high is not impulsive. I have tried many. many ways to count it as impulsive in the past, and I took a swing at it again today. I simply can not find a good way to do it. Believe me, if I could count it as impulsive I would gladly publish it. 

To prove this point, if you look within the (a) and (c) waves up from December to Minor W, you will see impulsive counts. Further, if you will look on the right hand side of the chart, you will see the recent minute (a) wave is also counted impulsively. The key is without this impulsive count, then wave iv within the new minute (a) becomes too long in time, and creates a degree violation. The reason it works here is that minuet iv can have any time relationship to minuet ii because they are of the same degree.

Now, that should mean we are in a minute (b) wave downward. So far, there have been three waves down. But that seems too short in time to be the completed sequence. Again, if you look to the left of the chart and count the bars, the minute (b) wave within minor W took at least 62% of the time of minute (a) wave.

So what could happen? Unfortunately for those who want a definitive answer, we are again dealing with a "B" wave. And "B" waves can be literally anything from a flat, to a triangle, to a double or triple zigzag downward. Price simply has not yet come back down to test the breakout of the triangle yet. Perhaps it will. It is definitely not required to, but it could. How it gets there - if it gets there - is a darn good question.

If you are a student of Elliott Wave work, you know that this is how Elliott Wave logic works. "B" waves are notoriously difficult to predict - about the worse that there is. But a double-zigzag, triple zigzag or double-combination like a flat-x-zigzag could both waste some more time and provide for the downside test. So, we will take the count day-by-day and do our level best. 

One item readers will note is that even given the flurry of new all-time-highs the Elliott Wave Oscillator remains stuck on a divergence, and now is even declining. That should be telling us something.

Have a great rest of the weekend.
TraderJoe

37 comments:

  1. hi joe
    thank you for your fantastic work.
    in view of the course of the waves, the sequence is still long, since the waves must still be formed, then i, ii, iii, iv, v, Y (B).
    that's how you see the flow ???
    it will go up again for 3 months?
    it's a very complicated wave
    thank you joe for everything you do

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    Replies
    1. first it should make a better (b), sideways to lower somehow.

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  2. Whatever difficulties there are in counting Dec to May as impulsive, this wave up has now breached the 138.2% ext of A and so can no longer be B. Just as between Dec and Jun 2018, it is in a different count now to DOW/S&P.

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    Replies
    1. Your information is just not correct. I show no breach of that level on NQ until 8,457.70 which has not been touched yet in the NQ and 3,181 in the ES which has not been touched yet. And there are many, many "B" waves that go to 150% or 161%.

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    2. My broker shows 7715.3 for the end Aug 2018 high and 5801.3 for the end Dec 2018 low, so 8446.45 is the 1.382 ext. They used to have Oct 2018 as the high but subsequently revised it lower. Very strange as never seen that occur before.

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    3. I gave up trying to project targets using fib retracements. They are being violated with regularity, one of the most glaring examples being the 2.618 of the 2007 to 2009 wave at 3091 (for ES). If my observation regarding the significance of price action around the round numbers is valid, 3200 could certainly now be in play if 3100 not surrendered next week.

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  3. Stvk999,
    The 1.382 extension in the cash market is 3176.....we are still below it.

    ReplyDelete
  4. Replies
    1. Scotty, when you reply to someone, use the reply link in their comment. Thanks.

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  5. Replies
    1. Scotty, if you first do click at Reply and after you login into google/blogspot, the message does not goes under the comment that you want to respond. It is necessary click again on Reply after loging. A common error at these blogs.

      So, it is necessary to press Reply just before pressing the button .

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    2. So, it is necessary to press Reply just before pressing the "Publish" button.

      Delete
  6. Since we have been in an uptrend, the minute and minuette upward b waves have been considerably longer than the a waves. Conversely, the c waves have been relatively brief, and not even re-tracing past the start of the a waves. If the pattern holds, the downward minute b wave could now be quite brief with the final c wave up to complete Y once more extended. I don't see how this can happen and the existing momentum divrgences not be negated with indicators going on to new higher highs. Welcome to an era of endless CB liquidity. This market could go higher than many of us were expecting. Nonetheless, the current technical extremes STILL point to a major downside move.
    Never seen such strange price action!

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  7. Thank you Joe for the analyses. It Will be interesting the last wave. A lot of bulls already forecast s&p at 3400 for the first quarter 2020 ! Most counts this last (a)(b)(c) as an impulse, and they expect W=Y (using other labels).

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  8. ALl EWavers I read ( afew) are now looking back up to new highs. Just saying.

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    Replies
    1. The trend remains up, so hardly news-worthy...

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    2. When the bullish counts become the majority is the time I go short. And it's happening now.

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  9. Here are the hourly futures at the open.

    https://invst.ly/o-7ql

    TJ

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    Replies
    1. ..with the new local high, the NQ futures have now reached 90% and can qualify for the "B" wave of a flat or the next impulse higher.

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    2. IF you look at it as a fractal in 10 min chart, your a, b, c dwn makes an a,b and 5 waves dwn to your wave "a" then the first top after is an x wave followed by an identical a, b, 5 wave c. So you have two identical elongated flats binded together by an x wave. So if you take your abc wave dwn and make that a, followed by b up to the secondary top you have a very large a and b wave which is identical to the smaller elongated flats a and b waves. The C wave from this should be very steep and fast down Approx 15 percent before x- mas. It is likely to start immediately as of tonight, tomorrow and accellerate after next weekend.

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    3. So what you should see from now is two elongated flats dropping a combining (47-49)% before xmas (15-20)% mid Jan 2020 the rest. Almost like Flash crashes.

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  10. Opening gaps down all quickly filled. Extremely peculiar in the current lop-sidedly bullish environment. I doubt it is short selling, but rather a continuation of big market exits. Very sobering indeed...!

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    Replies
    1. Another interesting thing about market money flows. If you look at the VIX one minute chart at around 8 pm, there was an absolutely massive sell order. The open interest in the put call ratio did NOT change on that spike down so this was some kind of futures arbitrage event. Bottom line is that it looked like an attempt to push a risk/parity long trade the markets and it back-fired big time...!

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  11. Interestingly, the Dow cash has made a lower low before filling it's gap.

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  12. Interesting indeed.
    The NDX 5 minute candle and volume chart now starting to reflect the short term massive cash inflows into the market with prices now below the apex of the cash dump. "Non-Q.E." for the cash sessions loosing efficacy it would appear....

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  13. fyi - NQ has broken the overnight low.

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  14. Here's what I have on the NQ, so far. Hard to find a sign of a powerful third wave. Current wave is less than c = a.

    https://invst.ly/o-blr

    TJ

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    Replies
    1. I agree. VIX close above 15 puts risk parity long trades at risk and traders are going to be getting a visit from risk desk managers after the close...will be interesting to see if gaps remain open if that happens...

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  15. 0-2 TL broken, so no threat of nested 1-2

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  16. More market divergence weirdness. NDX now the only index evidencing gap support from last Friday. Considering the weighting of tech in the other indices hard to not expect a reversal upward in other indices if NDX holds gap support...

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    ReplyDelete
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